Whether you joined an already established practice putting in the time and investment to become a partner, or started your own from scratch, those who are part of a private practice are part of much more than just a profession in the medical community — they are also business owners. There are many benefits and responsibilities that come with this independence. Not only are you caring for your patients, but you are also responsible for running the business side of things.
As such, this asset can require extra care when going through a divorce. If not handled wisely, the divorce can do more than impact your earning capacity. It could have a negative effect on the practice as a whole and impact partners, staff, and even patients. The following steps can help mitigate this risk.
#1: Proactive steps are important
The adage an ounce of prevention is worth a pound of cure holds true in more than just the medical world. This practice is also useful when it comes to protecting business interests. There are two options within family law that can help protect these interests when it comes to divorce:
- Prenuptial agreement. When valid, the parties can use this legal contract to address how they will handle assets like business interests, including those tied to a medical practice, during a divorce.
- Postnuptial agreement. A relatively new option in the family law world, a postnuptial agreement can achieve the same goals as a prenuptial agreement.
The key difference between these agreements is timing. The parties draft and sign a prenuptial agreement prior to the marriage, a postnuptial during the marriage.
#2: Know your priorities
Those who are going through a divorce, with or without the benefit of a pre or postnuptial agreement, are wise to get a thorough grasp on their assets. Depending on the details of your case, the law may consider your business interests tied to the medical practice a marital asset subject to division during divorce. You still have options to preserve this asset even if this is the case.
One option is to offer another asset of similar value in exchange for full retention of the business interests tied to the practice. This could mean the party who wishes to retain the business interests tied to the practice offer the family home, a vacation property, or a portion of retirement assets or other investments so the business interests remain intact.
This is just one consideration when navigating the asset division determination portion of the divorce proceeding. An attorney experienced in this area of the law can provide guidance on this and other matters, working to better ensure your interests are protected and reduce the risk of any surprises after the divorce is finalized.
